Hereford’s MandM scraps IPO after £140m Danish acquisition

WEST Midlands-based online clothing retailer MandM Direct has abandoned its plans to float on the London Stock Market after being acquired by a Danish company in a deal worth £140m.

The Herefordshire business had announced earlier this month it planned to follow West Midland retailer Poundland by progressing an IPO with the ultimate aim of trading on the Alternative Investment Market.

Predictions were that the IPO could be worth somewhere between £140m to £170m. The price paid for the Leominster business suggests the valuations were correct.

In a statement, MandM Direct said it had signed a definitive agreement with Bestseller worth up to £140m.

M and M has been owned by global growth private equity firm TA Associates since 2007. The sale is contingent upon standard regulatory clearance and is expected to be completed within eight weeks. Additional terms of the agreement have not been disclosed.

M and M was founded in 1987 and has grown to become a leading online retailer selling discounted branded ranges from companies such as adidas, Converse, Diesel, Helly Hansen and UGG at reductions of up to 75% off RRP.

It is effective because it acts as a clearing house for brand owners needing to rid themselves of large batches of excess stock.

The company has dedicated local market websites covering the UK, German, French, Austrian, Dutch and Polish markets, and also serves more than 20 additional countries worldwide.

The shareholders in M and M were advised by Canaccord Genuity and Macfarlanes.

“We have worked with M and M for several years, and we have come to know the people within the company as passionate and hard-working people who have achieved many positive results lately. We believe that M and M will continue to develop and become a leading company within its business and its markets,” said Bestseller Communication Director Mogens Werge

“We trust that the collaboration will become beneficial for both our companies in the long run, and we look forward to be working with and learning from M and M on areas like mobile sales.”

The two companies will continue to trade as separate units.